Financial Results for the Fiscal Year Ended October 31, 2017
[Japan GAAP] (Consolidated)
Date:

December 7, 2017

Company Name and Code: Tomoe Engineering Co., Ltd. and Subsidiaries - 6309
(URL: http://www.tomo-e.co.jp/index_e.html)
Stock exchange listing:

1st Section, Tokyo Stock Exchange

Head Office:5-15, Kitashinagawa 5-chome, Shinagawa-ku, Tokyo, Japan

President:

Hitoshi Yamamoto

Investor Relations Contacts: Toshiaki Yakura, Director, General Manager of Accounting Division, Tel: (03) 3442-5127
Date of Annual Shareholders Meeting: January 30, 2018
Date of Dividend Payment:

January 31, 2018

Date of Financial Statement: January 30, 2018
Preparation of Supplementary Explanatory Materials for Annual Operating Results: Yes
Briefing Session for Annual Operating Results: Yes (for analysts and institutional investors)* Any fractional sums less than one million (or one thousand) yen are disregarded
1. Consolidated Financial Results for the Year Ended October 31, 2017
(1) Results of Operation (Consolidated)(Percent: change from the previous year)
Operating Income
Ordinary Income

Net Sales(Millions of Yen)

(Percent)(Millions of Yen)

Year Ended
41,0934.9
2,198
October 31, 2017
Year Ended
39,180-0.4
1,970
October 31, 2016
(Note) Comprehensive income
Fiscal year ended October 31, 2017: 2,282 million yen (440.3%)
Fiscal year ended October 31, 2016: 422 million yen (-65.9%)
Net Income Attributable to
Owners of the Parent(Millions of Yen)

(Percent)(Percent)(Millions of Yen)

(Percent)

11.6

2,219

24.7

42.0

1,780

4.5

Net Income
per Share

Fully Diluted Net
Income per
Share

Return on
EquityReturn on
AssetsReturn on
Sales

(Yen)

(Yen)

(Percent)(Percent)(Percent)

5.8

6.2

5.3

3.8

5.1

5.0

Year Ended
1,503
55.1
150.64
October 31, 2017
Year Ended
968
-5.8
97.10
October 31, 2016
(Reference) Equity in earnings (loss) of unconsolidated subsidiaries and affiliates
Fiscal year ended October 31, 2017: None
Fiscal year ended October 31, 2016: None
(2) Financial Condition (Consolidated)
Total Assets (A)Net Assets (B)Net Assets Ratio (B / A)

Net Assets per Share(Millions of Yen)

(Millions of Yen)

(Percent)(Yen)

36,58027,00873.8

2,706.72

34,792

25,17372.4

2,522.81

Year Ended
October 31, 2017
Year Ended
October 31, 2016

(Reference) Net assets
Fiscal year ended October 31, 2017: 27,008 million yen
Fiscal year ended October 31, 2016: 25,173 million yen(3) Cash Flows (Consolidated)
Net Cash Provided(Used) by Operating
Activities
Year Ended
587
October 31, 2017
Year Ended
3,744
October 31, 2016

Net Cash Provided(Used) by Investing
Activities

Net Cash Provided(Used) by Financing
Activities(Millions of Yen)
Consolidated Cashand Cash Equivalent
as of Year-end

(392)

(449)

7,893

(255)

(449)

8,056

2. Dividend Status
Dividend per Share (Yen)
SecondEnd ofThird Quarter
Quarter
Fiscal Year
22.50
22.50
22.50
22.50
22.50
22.50

First Quarter-

Year Ending October 31, 2016
Year Ending October 31, 2017
Year Ending October 31, 2018 (Prospect)

Total
45.00
45.00
45.00

Total Dividend

Dividend Payout Ratio(Consolidated)

Dividend on Equity Ratio(Consolidated)(Millions of Yen)

(Percent)(Percent)

449
449

46.3
29.9
31.4

1.8
1.7

Year Ending October 31, 2016
Year Ending October 31, 2017
Year Ending October 31, 2018 (Prospect)

3. Forecast for the Year Ending October 31, 2018 (Consolidated)(Percent: Change from the previous year for the full business year and 6-month period)
Sales
Full Business Year

Operating Income(Millions of Yen)

(Percent)(Millions of Yen)

(Percent)(Millions of Yen)

(Percent)

42,800

4.2

2,100

-4.5

2,100

-5.4

Net Income Attributable to
Owners of the Parent
Full Business Year

Ordinary Income

Net Income per Share(Millions of Yen)

(Percent)

(Yen)

1,430

-4.9

143.31(Note) Since the company performance objectives are set annually, forecast for the consolidated second quarter
period is omitted.

Notes(1) Significant changes in subsidiaries during this period (changes in specific subsidiaries involving changes in thescope of consolidation): None
(2) Changes in accounting principles, changes in accounting estimates, and retrospective restatements
1) Change due to revision of accounting standard: Yes
2) Other changes than the above 1): None
3) Change in accounting estimates: None
4) Retrospective restatements: None
For details, please refer to (Changes in accounting principles) of (5) [Notes for Consolidated Financial
Statements] of 3. [Consolidated Financial Statements and Main Notes] on page 14.
(3) Number of outstanding shares (Common stock)1) Number of outstanding shares at year-end (including treasury stocks)
At October 31, 2017: 10,533,200 shares

At October 31, 2016: 10,533,200 shares

2) Number of treasury stocks at year-end
At October 31, 2017: 554,817 shares

At October 31, 2016: 554,667 shares

3) Number of average shares
At October 31, 2017: 9,978,419 shares

At October 31, 2016: 9,978,533 shares*This financial report is exempt from audit procedures.
*Explanations for appropriate use of the earnings forecast and other special instructions
The forward-looking statements such as a forecast of our financial results described herein are based on theinformation currently available to us and the assumptions that we believe are reasonable. Actual results could differ
materially due to various factors. For the operating results forecast, refer to (1) [Overview Concerning Operating Results]of 1. [Overview of Operating Results, etc.] on page 2.

Table of Contents of Accompanying Documents
1. Overview of Operating Result, etc.……………………………………………………………………………………..2(1) Overview Concerning Operating Results………………………………………………………………………....2(2) Overview Concerning Financial Condition……………………………………………..…………………………..3(3) Basic Policy for Profit Sharing and Dividends for Fiscal 2017 and 2018………………………………….......5
2. Basic Approach to the Selection of Accounting Standards…………………………..………………………………5
3. Consolidated Financial Statements and Main Notes………………………………………………………………....6(1) Balance Sheets………………………………………………………………………………………………………...6(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income………………….8
Consolidated Statements of Income………………………………………………………………………….8
Consolidated Statements of Comprehensive Income………………………………………………………….9(3) Consolidated Statements of Changes in Shareholders' Equity………..………..……………………………10(4) Consolidated Statements of Cash Flows………………………………………………………………………...12(5) Notes for Consolidated Financial Statements…………………………………………………………………..14(Notes for premise of going concern)…………………………………………………………………………...14(Changes in accounting principles)……………………………………………………………………………...14(Segment information)……………………………………………………………………………………………...15(Per Share information)………………………………………………………….…………………………………18(Significant subsequent events)………………………………………………………………………………….18
5 Other Notes…………………………………………………………….………………………………………………....19(1) Changes of Officers (effective January 30, 2018)………………………………………………………………...19

1

1. Overview of Operating Results, etc.
(1) Overview Concerning Operating Results(General condition of the current consolidated fiscal year)[1] Overview of general operating results
During the consolidated fiscal year ended October 2017, Japan’s economy maintained a steady recovery trend,
backed by rising exports that were powered by the economic recovery overseas, increasing momentum in capital
investment that was driven by improved corporate earnings, and a gradual rebound in personal consumption.
The steady pace of expansion continued overseas as well, despite a modest slowdown in China’s economy,against the backdrop of sustained brisk economic activity in Asia overall and the ongoing expansionary trend of
the US economy.
Given these circumstances, full-year net sales for the Tomoe Engineering Group increased 4.9% from theprevious consolidated fiscal year to 41,093 million yen because of increasing sales in both the Machinery& Equipment Business and Chemical Products Business. From an earnings aspect, operating income was
2,198 million yen, 11.6% up from the previous consolidated fiscal year because of higher income in both the
Machinery & Equipment Business and Chemical Products Business, while ordinary income came to 2,219
million yen, 24.7% up from the previous consolidated fiscal year because foreign exchange losses were lower.
Net income attributable to owners of the parent was 1,503 million yen, 55.1% up from the previous
consolidated fiscal year because of no impairment loss for consolidated subsidiary fixed assets recorded in
the previous fiscal year.

[2] Summary by business segment(Machinery & Equipment Business)
In the Machinery & Equipment Business, net sales for both domestic public sector demand and domestic
private sector demand in general decreased, but on the other hand net sales of machinery, components andrepair services for overseas markets increased. As a result, consolidated net sales for the fiscal year were
10,241 million yen, 0.6% up compared with the previous fiscal year.
From an earnings aspect, operating income was 528 million yen, 31.0% up from the previous consolidated
fiscal year, mainly because of increased profit from machinery, components and repair services for overseas
markets, and improved profitability in sales for domestic public sector demand.
(Chemical Products Business)
In the Chemical Products Business, net sales of UV curing resin and flame retardant in the fine chemicals sector
decreased, but on the other hand net sales of materials for housing and construction applications in the industrial
materials sector and net sales of transport materials for semiconductor manufacturing applications in theelectronics materials sector were robust, and the Shenzhen plastic compounding business exhibited a recovery
trend. As a result, consolidated net sales for the fiscal year were 30,851 million yen, 6.4% up from the previous
consolidated fiscal year.
With respect to earnings, operating income was 1,670 million yen, 6.6% up from the previous consolidated fiscal
year despite sluggish performance in the fine chemicals, advanced materials, and electronics materials sectors.
In addition to excellent conditions in the industrial materials sector, earnings were supported by the recovery of
the plastic compounding business at our Hong Kong office and in Shenzhen, China.

2[3] Outlook for the next fiscal year (November 1, 2017 - October 31, 2018)
In the consolidated fiscal year ending October 2018, Japan’s economy is expected to stay on its recovery track,as exports maintain their upward course, capital investment remains robust because of the brightening corporate
earnings environment and other factors, and personal consumption appears set to continue growing gradually as
well. Internationally, the steady pace of growth is expected to continue, despite China’s economy following aslow deceleration tendency, as the expansionary trend of the US economy is forecast to continue.
Given such conditions, in the Machinery & Equipment Business we forecast sales of equipment for domestic
public sector demand in anticipation of large-scale projects, sales for domestic private sector demand to meet
expected growth in components and repair services sales, and overseas sales, centered on Asia and North
America, will all be higher. Consequently, we project consolidated net sales of 11,470 million yen, 12.0% up
compared with the previous fiscal year, and operating income of 550 million yen, or 4.1% up from the previous
fiscal year. In the Chemical Products Business, although sales of commercial products for wire bonding devices
and semiconductor fabrication equipment in the electronics materials sector will be sluggish, sales of materials forautomobile and housing and construction applications in the industrial materials sector, and sales of ceramics
products for semiconductor fabrication equipment in the advanced materials sector, are expected to grow, as are
sales in the plastic compounding business in Shenzhen, China. Based on this we expect consolidated net
sales to be 31,330 million yen, 1.6% up compared with the previous fiscal year. On the other hand, we expect
operating income to come to 1,550 million yen, 7.2% down compared with the previous fiscal year, reflecting theimpact of an anticipated decline in sales in the electronics materials sector and the disappearance of somecommercial products in the fine chemicals sector.
As a result of these efforts, for the entire Tomoe Engineering Group in the consolidated fiscal year ending October
2018, we project net sales to grow by 4.2% to 42,800 million yen, operating income to decrease by 4.5% to 2,100
million yen, ordinary income to decrease by 5.4% to 2,100 million yen, and net income attributable to the shareholdersof the parent company to decrease by 4.9% to 1,430 million yen because we do not anticipate any special factors,
including extraordinary income or losses.
The operating results forecasts for the next period described above are based on information available to theCompany at the time the forecasts were prepared and assumptions judged to be reasonable. Actual operating
results might differ from these forecasts depending upon changes in domestic and international financial andeconomic conditions, the supply and demand situation, various risk factors and other uncertainties.
(2) Overview Concerning Financial Condition[1] Summary of Assets, Liabilities, and Net Assets
Assets at the end of the current consolidated fiscal year were 36,580 million yen, up 1,788 million or 5.1% fromthe balance at the end of the previous consolidated fiscal year, reflecting decrease in cash and deposits, andincrease in notes and accounts receivable-trade, inventory and asset for retirement benefits.
Liabilities were 9,572 million yen, down 45 million yen or 0.5% from the end of the previous consolidated fiscal
year, mainly because of lower income taxes payable and advances received, and of increased deferred tax
liabilities and payables.
Net assets were 27,008 million yen, 1,834 million yen or 7.3% up from the end of the previous consolidated
fiscal year. This mainly reflected an increase of retained earnings reported at the current consolidated net
income.
As a result of the above changes, the equity ratio at the end of the consolidated fiscal year increased by 1.4
point compared with the end of the previous consolidated fiscal year to 73.8%.

3[2] Summary of Cash Flow
Balance of cash and cash equivalent as of the end of the current consolidated fiscal year decreased by 162 million
yen to 7,893 million yen from the previous consolidated fiscal year. Status of each cash flow and their factors
during the current consolidated fiscal year are as follows:(Net Cash Provided by (Used in) Operating Activities)
Net cash provided by operating activities was 587 million yen (3,744 million yen provided during the previous
consolidated fiscal year) reflecting increase in notes and accounts receivable-trade by 1,016 million yen, income
taxes payment used in 1,049 million yen, and income before income taxes and minority interests provided by
2,227 million yen.
(Net Cash Provided by (Used in) Investing Activities)
Because purchases of plant, property and equipment were 181 million yen, and increased guarantee deposits
were 201 million yen, the net amount of cash used in investing activities was 392 million yen (255 million yen
used during the previous consolidated fiscal year).
(Net Cash Provided by (Used in) Financing Activities)
Net cash used in financing activities was 449 million yen (449 million yen used during the previous consolidated
fiscal year) mainly for the payment of cash dividends in 449 million yen.
The trends in cash flow indices are as follows:
Trends in cash flow indicesYear Ended
October 31,
2013

Year Ended
October 31,
2014

Year Ended
October 31,
2015

Year Ended
October 31,
2016

Year Ended
October 31,
2017

Equity Ratio (Percent)
Equity Ratio Based on
Market Value (Percent)

69.8

70.8

73.4

72.4

73.8

46.6

51.7

44.3

44.3

59.1

Debt-repayment to Cash
Flow Ratio (Years)

1.7

0.2

-

0.0

0.2

Interest Coverage Ratio(Percent)

35.6

74.5

-

735.6

28.3

Equity ratio: Net assets/ Total assets
Equity ratio based on market value: Market capitalization of shares / Total assets
Debt-repayment to cash flow ratio: Interest-bearing debt / Cash flow
Interest coverage ratio: Cash flow /Interest payment(Note)
1. All indices are calculated on the basis of consolidated financial figures.
2. Market capitalization is calculated based on the number of outstanding shares excluding treasury stock.
3. Cash flow refers to net cash provided by (used in) operating activities.
4. Interest-bearing debt refers to all debt reported on the consolidated balance sheet for which interest is
being paid.
5. The debt-repayment to cash flow ratio and interest coverage ratio for the year ended October 31, 2016 are
not shown because they were negative.

4(3) Basic Policy for Profit Sharing and Dividends for Fiscal 2017 and 2018
As its basic policy, the Tomoe Engineering Group will “implement appropriate, stable dividends by seeking toincrease internal reserves to reinforce our financial position and corporate strength, and by considering consolidated
operating results, the group’s medium-term business strategy and other factors in a comprehensive manner.”
Based on the above policy, we plan to pay a dividend of 45 yen per share, including the dividend of 22.5 yen per
share for the consolidated fiscal year ending on October 31, 2017, and the interim dividend of 22.5 yen per share.
For the dividend for the next consolidated fiscal year, we plan to pay 45 yen per share (including an interim dividend
per share of 22.5 yen), based on consideration of the outlook for consolidated operating results.

2. Basic Approach to the Selection of Accounting Standards
At the present time the Tomoe Engineering Group has adopted Japan GAAP, based on factors such as comparability
between firms, and the Group’s policy concerning the application of IFRS will be to respond while referring to outside
trends and other considerations.

53. Consolidated Financial Statements and Main Notes(1) Balance Sheets(Thousands of Yen)
Year Ended October 31, 2016

Year Ended October 31, 2017

Cash and Deposits

8,056,223

7,893,336

Notes and Accounts Receivable-Trade

11,618,030

12,423,898

Electronically Recorded Monetary Claims

1,702,590

1,823,085

Merchandise and Finished Goods

2,746,735

3,045,330

Work in Process

1,166,982

1,121,215

Raw Materials and Supplies

595,198

626,777

Deferred Tax Assets

500,420551,335

Others282,133

169,602-4,645-5,793

26,663,670

27,648,788

4,316,576

4,447,596

Accumulated Depreciation-1,592,835-1,714,451

Buildings and Structures, Net

2,723,740

2,733,144

Machinery, Equipment and Vehicles

3,659,243

3,753,847-3,215,574-3,339,171

443,669

414,676

1,931,071

1,931,034

96,763－

983,261

999,146-919,694-914,964

63,567

84,181

5,258,812

5,163,038

304,807

186,343

Investment Securities

1,149,211

1,520,735

Guarantee Deposits

89,809293,537

1,242,576

1,693,578

Others110,849

101,325

Allowance for Doubtful Accounts-27,664-26,386

Total Investments and Other Assets

2,564,783

3,582,791

Total Noncurrent Assets

8,128,402

8,932,172

Total Assets

34,792,072

36,580,961

AssetsCurrent Assets

Allowance for Doubtful Accounts
Total Current Assets
Noncurrent Assets
Property, Plant and Equipment
Buildings and Structures

Accumulated Depreciation
Machinery, Equipment and Vehicles, Net
Land
Construction in progress
Others
Accumulated Depreciation
Others, Net
Total Property, Plant and Equipment
Intangible Assets
Investments and Other Assets

Net Defined Benefit Assets

6

(Thousands of Yen)
Year Ended October 31, 2016

Year Ended October 31, 2017

Notes and Accounts Payable-Trade

3,667,658

4,090,419

Electronically Recorded Monetary Debt

1,891,465

1,665,615

Accounts Payable-Others

558,442

520,046

Income Taxes Payable

632,403437,430

Advances Received

333,999

57,481

Provision for Bonuses

802,914982,841

Provision for Directors' Bonuses

50,35264,678

Allowance for Product Warranty

107,349

185,258

Others424,583

189,552

8,469,170

8,193,325

Liabilities and Net Assets
Liabilities
Current Liabilities

Total Current Liabilities
Noncurrent Liabilities
Provision for Directors' Retirement Benefits

5,460

5,460

Net Defined Benefit Liabilities

56,13557,4981,087,402

1,315,959

Total Noncurrent Liabilities

1,148,998

1,378,918

Total Liabilities

9,618,169

9,572,243

Capital Stock

1,061,210

1,061,210

Capital Surplus

1,483,410

1,483,410

Retained Earnings

22,833,826

23,889,646-363,591-363,876

Total Shareholders’ Equity

25,014,855

26,070,389

Accumulated Other Comprehensive Income
Valuation Difference on Available-for-Sale
Securities
Deferred Gains or Losses on Hedges

299,418

551,039-17,8132,508

Foreign Currency Translation Adjustment

90,213

214,564

Total Adjustment on Net Defined Benefit-212,770

170,216

Total Accumulated Other Comprehensive Income

159,048

938,328

Total Net Assets

25,173,903

27,008,718

Total Liabilities and Net Assets

34,792,072

36,580,961

Deferred Tax Liabilities

Net Assets
Shareholders’ Equity

Treasury Stock7

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive
IncomeConsolidated Statements of Income(Thousands of Yen)
Year Ended October 31, 2016

Year Ended October 31, 2017

Net Sales

39,180,324

41,093,188

Cost of Sales

30,903,454

32,216,513

Gross Profit

8,276,870

8,876,674

Selling, General and Administrative Expenses

6,306,828

6,678,304

Operating Income

1,970,041

2,198,369

Interest income

5,842

1,301

Dividends Income

24,696

26,771

Rent Income

6,831

6,831

-

8,380

25,87622,85963,247

66,144

Interest Expenses

5,089

20,726

Commission Paid

9,508

9,000

Sales Discount

5,829

6,133

223,031

-

9,706

9,499

Total Non-Operating Expenses

253,164

45,359Ordinary Income

1,780,124

2,219,155

Gain on Sales of Investment Securities

4,510

8,524

Total Extraordinary Income

4,510

8,524

101,908-

Loss on Sales of Investment Securities

1,377

-

Total Extraordinary Losses

103,286-

1,681,348

2,227,679

Income Taxes-Current

868,544830,225

Income Taxes-Deferred-156,119-105,724

Total Income Taxes

712,424

724,500

Net Income
Net Income Attributable to
Owners of the Parent

968,923

1,503,178

968,923

1,503,178

Non-Operating Income

Foreign Exchange Gains
OthersTotal Non-Operating Income
Non-Operating Expenses

Foreign Exchange Losses
OthersExtraordinary Income

Extraordinary Losses
Loss on Impairment

Income before Income Taxes

8

Consolidated Statements of Comprehensive Income(Thousands of Yen)

Net Income

Year Ended October 31,

Year Ended October 31,

2016

2017
968,923

1,503,178

Valuation Difference on Available-for-sale Securities-31,099

251,620

Deferred Gains or Losses on Hedges-18,562

20,321

Foreign Currency Translation Adjustment-324,858

124,351

Adjustment on Net Defined Benefit-171,950

382,987

Total Other Comprehensive Income-546,470

779,280

422,452

2,282,459

422,452

2,282,459

Other Comprehensive Income

Comprehensive Income(Breakdown)Comprehensive Income Attributable to Owners of the
Parent9

(3) Consolidated Statements of Changes in Shareholders' Equity
Previous Consolidated Fiscal Year (Year Ended October 31, 2016)(Thousands of Yen)
Shareholders' Equity
CommonStock
Surplus during Previous
Fiscal Year
Cumulative Effect of
Accounting Changes
Surplus Reflecting
Accounting Changes
Changes during This
Fiscal Year
Cash Dividend Paid
Net Income Attributable to
Owners of the Parent
Total (Net) Amount
Changed (Except
Shareholders' Equity)
Total Amount Changed
Surplus during This Fiscal
Year1,061,210

CapitalSurplusRetained
Earnings

1,483,410

22,313,936

Issued Shares
Reacquired-363,591

Total Net
Assets24,494,965-

1,061,210

1,483,410

22,313,936-363,591

24,494,965-449,033-449,033

968,923

968,923--

519,889-

519,889

1,061,210

1,483,410

22,833,826-363,591

25,014,855

Accumulated Other Comprehensive Income
Valuation
Difference on
Available-for-sale
Securities

Surplus during Previous
Fiscal Year
Cumulative Effect of
Accounting Changes
Surplus Reflecting
Accounting Changes
Changes during This
Fiscal Year
Cash Dividend Paid
Net Income Attributableto Owners of the Parent
Total (Net) Amount
Changed (Except
Shareholders' Equity)
Total Amount Changed
Surplus during This
Fiscal Year

330,518

Deferred
Gains or
Losses on
Hedges748

Foreign
Currency
Translation
Adjustment

415,072

Total Net
DefinedBenefit-40,820

Total Other
Comprehensive Income

705,518

Total Net
Assets

25,200,484-

330,518748

415,072-40,820705,518

25,200,484-449,033
968,923-31,099-18,562-324,858-171,950-546,470-546,470-31,099-18,562-324,858-171,950-546,470-26,581

299,418-17,813

90,213-212,770

159,048

25,173,903

10

Current Consolidated Fiscal Year (Year Ended October 31, 2017)(Thousands of Yen)
Shareholders' Equity
CommonStock
Surplus during Previous
Fiscal Year
Cumulative Effect of
Accounting Changes
Surplus Reflecting
Accounting Changes
Changes during This
Fiscal Year
Cash Dividend Paid
Net Income Attributable to
Owners of the Parent
Acquisition of Treasury
Stock
Total (Net) Amount
Changed (Except
Shareholders' Equity)
Total Amount Changed
Surplus during This Fiscal
Year1,061,210

CapitalSurplusRetained
Earnings

1,483,410

22,833,826

Issued Shares
Reacquired-363,591

1,671
1,061,210

1,483,410

22,835,498

Total Net
Assets25,014,855
1,671-363,591

25,016,527-449,030-449,030

1,503,178

1,503,178
-285

-285

-

-

1,054,148-285

1,053,862

1,061,210

1,483,410

23,889,646-363,876

26,070,389

Accumulated Other Comprehensive Income
Valuation
Difference on
Available-for-sale
Securities

Surplus during Previous
Fiscal Year
Cumulative Effect of
Accounting Changes
Surplus Reflecting
Accounting Changes
Changes during This
Fiscal Year
Cash Dividend Paid
Net Income Attributableto Owners of the Parent
Acquisition of Treasury
Stock
Total (Net) Amount
Changed (Except
Shareholders' Equity)
Total Amount Changed
Surplus during This
Fiscal Year

299,418

Deferred
Gains or
Losses on
Hedges-17,813

Foreign
Currency
Translation
Adjustment

90,213

Total Net
DefinedBenefit-212,770

Total Other
Comprehensiv
e Income

159,048

Total Net
Assets25,173,903
1,671

299,418-17,813

90,213-212,770

159,048

25,175,575-449,030
1,503,178-285

251,620

20,321

124,351

382,987

779,280

779,280

251,620

20,321

124,351

382,987

779,280

1,833,143

551,0392,508

214,564

170,216

938,328

27,008,718

11

(4) Consolidated Statements of Cash Flows(Thousands of Yen)
Year EndedYear Ended

October 31, 2016

October 31, 2017

Net Cash Provided by (Used in) Operating Activities
Income before Income Taxes and Minority Interests
Depreciation and Amortization

1,681,348
400,479

2,227,679
416,872

Increase (Decrease) in Provision for Bonuses

106,407

177,069

Increase (Decrease) in Provision for Directors' Bonuses

7,978

14,326

Increase (Decrease) in Allowance for Product Warranty
Increase (Decrease) in Net Defined Benefit Liability(15,128)

77,9082,953

870

Decrease (Increase ) in Net Defined Benefit Asset(42,773)(24,155)

4,225

(129)

(30,539)(28,073)

5,089

20,726

Foreign Exchange Losses (Gains)

188,234

49,918Loss (Gain) on Sales of Investment Securities(3,132)(8,524)

Loss on Impairment

101,908-

1,124,173(1,016,706)

Decrease (Increase) in Inventories

467,794(285,845)

Increase (Decrease) in Notes and Accounts Payable-Trade(186,024)

250,189

3,243(31,217)

Increase (Decrease) in Advances Received

242,526(290,874)

Others, Net

95,71379,7284,154,480

1,629,763

Interests and Dividends Income Received

31,17328,026

Interest Expenses Paid

(5,089)(20,726)(436,502)(1,049,876)

3,744,062

587,187

Increase (Decrease) in Allowance for Doubtful Accounts
Interests and Dividends Income
Interest Expenses

Decrease (Increase) in Notes and Accounts
Receivable-Trade

Increase (Decrease) in Accounts Payable-Others

Sub total

Income Taxes Paid
Net Cash Provided by (Used in) Operating Activities

12(Thousands of Yen)
Year EndedYear Ended

October 31, 2016

October 31, 2017

Net Cash Provided by (Used in) Investment Activities
Disbursement to Time Deposits(3,400,000)(4,900,000)

Proceeds from Withdrawal of Time Deposits

3,400,000

4,900,000

Purchase of Property, Plant and Equipment(171,539)(181,883)

-

1,638

Purchase of Intangible Fixed Assets(67,495)(4,235)Purchase of Investment Securities(18,178)(19,683)

Proceeds from Sales of Investment Securities

9,702

15,244

Payments of Loans Receivable(870)(2,020)

Collection of Loans Receivable

3,217

1,860

Guarantee Deposits (Increase)(9,281)(201,193)

Others, Net(1,424)(2,294)(255,870)(392,566)

-

(285)

(449,033)(449,030)(449,033)(449,316)(278,215)

91,8092,760,942(162,886)

5,295,280

8,056,223

8,056,223

7,893,336

Proceeds from Sales of Property, Plant and Equipment

Net Cash Provided by (Used in) Investment Activities
Net Cash Provided by (Used in) Financing Activities
Acquisition of Treasury Stock
Cash Dividends Paid
Net Cash Provided by (Used in) Financing Activities
Cash and Cash Equivalents
Effect of Exchange Rate Change on Cash and Cash
Equivalents
Net Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Period
Cash and Cash Equivalents at End of This Fiscal Year13

(5) Notes for Consolidated Financial Statements(Notes for premise of going concern)
There are no pertinent matters to report.
(Changes in accounting principles)
Beginning from the consolidated fiscal year ending on October 31, 2017, the Company has applied the
Implementation Guidance on Recoverability of Deferred Tax Assets (Accounting Standards Board of Japan Financial
Accounting Standards Implementation Guidance No. 26; referred to below as the Recoverability Implementation
Guidance), and has partially revised the method of accounting treatment concerning the recoverability of deferred tax
assets.
In applying the Recoverability Implementation Guidance, the Company has added the difference between the amountof deferred tax assets and deferred tax liabilities when it applied the provisions corresponding to paragraph 49 (3) ①
through ③ of the Recoverability Implementation Guidance at the beginning of the consolidated fiscal year ending on
October 31, 2017, and the amount of deferred tax assets and deferred tax liabilities at the end of the priorconsolidated fiscal year, to retained earnings at the beginning of t the consolidated fiscal year ending on October 31,
2017, in accordance with the transitional treatment provided in paragraph (4) 49 of the Recoverability Implementation
Guidance.
As a result, deferred tax liabilities decreased by 1,671,000 yen and retained earnings increased by 1,671,000 yen.

14

(Segment information)
1. Summary of reporting segments
TOMOE Engineering Co., Ltd. has established two operational headquarters. These operational headquarters aredeveloping their business activities by planning comprehensive domestic and overseas strategies for the respective
manufactured and commercial products they handle.
We therefore have assumed these two businesses, referred to as the “Machinery & Equipment Business” and the“Chemical Products Business”, as our company reporting segments. The Machinery & Equipment Business mainly
manufactures and sells centrifuge decanters, and the Chemical Products Business mainly manufactures, stocks
and sells chemical industry products.
The Company’s reporting segments are those units of the Company’s for which discrete financial information isavailable and for which the Board of Directors regularly conducts a review for the purpose of making decisions about
resources to be allocated to the segments and assess the segments' performance.
2. Method for calculating amounts of net sales, income or loss, assets, liabilities and other items for each reporting
segment
The accounting methods for reporting segments are identical to the accounting methods adopted for preparation of
the consolidated financial statements.

3. Information concerning the amount of net sales, income or loss, assets, liabilities and other items for each reporting
segment
Previous Consolidated Fiscal Year (Year Ended October 31, 2016)(Thousands of Yen)
Amount ofConsolidated
Adjustment
Financial
Note 1
Statements
Reported
AmountReporting segment
Machinery &Equipment
Business
Sales
Sales to Unaffiliated Customers
Internal Sales Among Segments
or Amount Transferred
Total
Segment Income
Segment Assets
Other Items
Depreciation & Amortization
Increase in Property, Plant &Equipment and Intangible Assets

Chemical
Products
Business

Total

10,178,070

29,002,253

39,180,324-

39,180,324

-

-

-

-

-

10,178,070
403,271
10,094,483

29,002,253
1,566,770
15,491,154

39,180,324
1,970,041
25,585,638

9,206,434

39,180,324
1,970,041
34,792,072

305,050

95,429400,479-

400,479

124,823

120,786

245,610-245,610(Notes)1. The adjustment amount for segment assets is the assets of the entire company that cannot be allocated to eachreporting segment, and is mainly idle operating funds (cash on hand and in banks), long-term investments(investment securities) and assets acquired in relation to a district redevelopment project.
2. The total amount for segment income agrees with the operating income reported on the Consolidated Statement of
Income.

15

Current Consolidated Fiscal Year (Year Ended October 31, 2017)(Thousands of Yen)
Consolidated
Amount of
Financial
Adjustment
Note 1
Statements
Reported
AmountReporting segment
Machinery &Equipment
Business
Sales
Sales to Unaffiliated Customers
Internal Sales Among Segments
or Amount Transferred
Total
Segment Income
Segment Assets
Other Items
Depreciation & Amortization
Increase in Property, Plant &Equipment and Intangible Assets

Chemical
Products
Business

Total

10,241,914

30,851,273

41,093,188-

41,093,188

-

-

-

-

-

10,241,914
528,306
10,213,195

30,851,273
1,670,063
16,952,694

41,093,188
2,198,369
27,165,889

9,415,072

41,093,188
2,198,369
36,580,961

314,283

102,589

416,872-

416,872

123,754

68,568

192,322-

192,322(Notes)1.The adjustment amount for segment assets is the assets of the entire company that cannot be allocated to eachreporting segment, and is mainly idle operating funds (cash on hand and in banks), long-term investments(investment securities) and assets acquired in relation to a district redevelopment project.
2. The total amount for segment income agrees with the operating income reported on the Consolidated Statement of
Income.
(Related information)
Previous Consolidated Fiscal Year (Year Ended October 31, 2016)
1. Information by product and service
The Company has omitted a description of information by product and service because this same information isdisclosed in segment information.
2. Regional Information
1. Net SalesJapan
32,083,421(Thousands of Yen)Asia
6,100,561

Others996,340

Total
39,180,324(Note)Net sales are classified by country or region based on the customer’s location.
2. Property, Plant and Equipment
Japan4,976,297

Asia
136,315(Thousands of Yen)
Others146,200

Total
5,258,812

3. Main Customer Information
The Company has omitted a description of sales to outside customers because there are no customers to which sales
account for more than 10% of the net sales reported in the Consolidated Statements of Income.

16

Current Consolidated Fiscal Year (Year Ended October 31, 2017)
1. Information by product and service
The Company has omitted a description of information by product and service because this same information isdisclosed in segment information.
2. Regional Information
1. Net SalesJapan
32,405,056(Thousands of Yen)Asia
7,088,888

Others1,599,242

Total
41,093,188(Note) Net sales are classified by country or region based on the customer’s location.
2. Property, Plant and Equipment
Japan4,858,891(Thousands of Yen)Asia
155,695

Others148,451

Total
5,163,038

3. Main Customer Information
The Company has omitted a description of sales to outside customers because there are no customers to which sales
account for more than 10% of the net sales reported in the Consolidated Statements of Income.
(Information concerning impairment losses on fixed assets by reporting segment)
Previous Consolidated Fiscal Year (Year Ended October 31, 2016)(Thousands of Yen)

Reported segments
Machinery &Equipment
Business
Impairment loss

1,505

Chemical
Products
Business

Subtotal

100,403

101,908

Elimination at
the Company

Total

-

Current Consolidated Fiscal Year (Year Ended October 31, 2017)
There are no pertinent matters to report.

(Information concerning amortization of goodwill and unamortized balances by reporting segment)
There are no pertinent matters to report.
(Information concerning gain on negative goodwill by reporting segment)
There are no pertinent matters to report.

17

101,908

(Per Share Information)
Year EndedYear Ended

October 31, 2017

October 31, 2016
81

Net Asset per Share¥2,522.

¥2,706.72

Net Income per Share¥97.10¥150.64(Note 1) Income per share for this fiscal year after adjustment of the residual securities is not presented as there are noresidual securities.
(Note 2) Calculation basis for net income per share are as follows:Year EndedYear Ended

October 31, 2016

October 31, 2017

Net Income for this Fiscal Year (thousands of yen)

968,923

1,503,178

Net Income for Common Stock (thousands of yen)

968,923

1,503,178

9,978,533

9,978,419

Average number of Common Stock during the Fiscal Year
(Note3) Calculation basis for net asset per share are as follows:

Total for Net Asset in Consolidated Balance Sheet(thousands of yen)
Net Asset for Common Stock (thousands of yen)
Number of Common Stock used for calculation of Net Assets
per Share (share)(Significant subsequent events)
None
.

18

Year EndedYear Ended

October 31, 2016

October 31, 201725,173,903

27,008,718

25,173,903

27,008,718

9,978,533

9,978,383

4. Other Notes(1) Changes of Officers (effective January 30, 2018)
1) Director scheduled to be appointed (excluding the directors who were appointed as a member of Audit & Supervisory
Committee, [The same applies hereinafter.])
Name
Tetsuyuki Azuma

New Position

Current Position

Director and Deputy Manager, Chemical ProductsManager, Advanced Materials Dept. of Chemical

Div. (in charge of Advanced Materials Dept. and

Products Div.

Industrial Materials Dept.), and Manager, Advanced
Materials Dept.

2) Director scheduled to retire
Name
Tetsuo Yamada

Current Position
Senior Managing Director
Chemical Products Div.

3) Directors scheduled to be promoted
Name
Akitomo Tamai

New Position

Current Position

Senior Managing Director

Director and Deputy Manager, Chemical Products

Chemical Products Div.

Div. (Synthetic Resin and Industrial Materials Dept.)4) Change of position as a result of the above changes
Name
Akiyoshi Shinoda

New Position

Current Position

Director and Deputy Manager, Chemical Products

Director and Deputy Manager, Chemical Products

Div. (in charge of Fine Chemicals Dept., Electronic

Div. (in charge of Advanced Materials Dept.,

Materials Dept. and Synthetic Resin Dept.)

Electronic Materials Dept. and Fine Chemicals Dept.)19